Need To Give A Wedding Present? How About 'Home Funds'?

Today’s brides and grooms are less interested in receiving material goods as wedding gifts and would be more receptive to “home funds” to be used for the purchase of their first house.

According to a new analysis conducted by Zillow Home Loans and The Knot, the share of couples including “home funds” as part of their wedding registry has increased 55% since 2018. Now, nearly 20% of all couples registered on The Knot are asking their guests to help them with the down payment on their first home.

Zillow pointed to recent research that found that half of all homebuyers are purchasing their first home, the highest share that Zillow has ever recorded, and they put down between 10% and 19% toward this acquisition. Between 2018 and 2022, first-time buyers were at least twice as likely to report putting gift funds toward their down payment – and during this year, 43% reported gift funds from friends and family as the source of at least part of their down payment funds.

“Home funds were one of the most popular wedding registry cash funds on The Knot in 2022 — the second, in fact, right behind the honeymoon fund,” said Esther Lee, deputy editor of The Knot. “It’s wonderful that couples feel empowered to make their registries ultra-personal to their goals, especially as they enter marriage together. While guests prefer to give cash gifts for celebratory treats, like a sunset honeymoon dinner, milestone gifting is a profoundly thoughtful and significant trend we’re seeing among couples planning on The Knot. Amid rising interest rates and historic highs for down payments, this particular wedding contribution helps newlyweds reach another meaningful life milestone: homeownership.”

“Young couples may be eschewing convention when it comes to their weddings, but they still aspire to achieve the age-old American dream of homeownership,” said Amanda Pendleton, a personal finance expert at Zillow Home Loans. “That dream, however, can feel out of reach without the right support. For couples who choose to add down payment funds to their registry, it’s important that they also work with a qualified loan officer to understand what they can afford and what loan options fit their situation. First-time buyers often think a 20% down payment is required, but that’s not always the case. Some may qualify for a down payment as low as 3%, which will change their savings timeline and monthly payment dramatically.”